New Product Development: A Supporting Player, Not the Silver Bullet in Sales & Marketing Strategy

There's an intrinsic appeal to envisioning your latest creation in-store, enchanting consumers and driving sales. However, it's critical to recognise that NPD is a means to an end - not the end in itself.

Too often, companies take a scattergun approach, creating as many products as possible, hoping something sticks.

This approach leads to an overcomplicated supply chain, less leverage in procurement, lower efficiency, and higher storage requirements, all adding entropy and significant system risk.

The Shelf Space Conundrum

Retailers limit shelf space, effectively capping the number of SKUs any manufacturer can have: more SKUs won't translate into more sales or a better customer experience. Instead, it means each SKU has less space, increasing the risk of stock out & lost sales. Too much choice inhibits decision making and, consumers can receive a random experience between shops. All of this confusion damages the brand and ultimately, sales.

Cannibalising Top Sellers

A long tail of similar products in the same category often results in the cannibalisation of top-selling items. Rather than adding to total sales, these 'me-too' products redistribute existing sales, reducing gross margins without yielding net revenue gain. It's a zero-sum game that could be avoided with a more thoughtful, strategic approach to NPD.

The Hidden Costs

Beyond creating an inconsistent customer experience, an overabundance of SKUs introduces hidden costs: higher manufacturing waste, storage costs, an increased risk of obsolete stock, and reduced batch sizes which in turn reduces Efficiency.

These are not trivial concerns in an environment requiring lean operations and cost-efficiency.

The Right Approach...

Instead of viewing NPD as a universal solution, it should be seen as a valuable but limited tool in a broader sales and marketing strategy. The goal of NPD should be to find the next 'gem' that can create a splash in the market and drive sales growth.

Rather than developing an array of similar products, focus NPD efforts on those that provide a unique value proposition, fill an unmet need, or deliver a differentiating benefit that can capture consumer attention and loyalty.

Driving Growth: The Real Deal

The path to sustainable growth comes from brilliant marketing of a brilliant product, expanding into new markets, and getting products into more consumer baskets. This requires understanding your consumers' needs and how your product can deliver value.

Use NPD to support growth ambitions. But remember, it's a support player in a bigger game. Driving growth requires strategic thinking, effective marketing, and, most importantly, a focus on delivering value to your consumers.

Next time you think about NPD, remember: the goal is not to fill shelves but to ful-fill a need. In doing so, you won't just develop a product; you'll develop a strategy for sustainable growth.